Does offshore outsourcing impact home employment? Evidence from service multinationals


This paper investigates the impact of offshore outsourcing across 5746 European service multinational enterprises (MNEs) on employment at home. We estimate labour demand equations and specifically isolate the global financial crisis (GFC) by undertaking analysis through our longitudinal 19-year panel data, separately for the pre- (1997–2007) and crisis period (2008–2016). We distinguish between offshoring to high and low income countries, as well as between service industry groups. We show that there is some evidence that offshoring by location intensive service firms is associated with employment growth at home during the crisis period, while offshoring in information intensive industries in high income countries is associated with a reduction in employment at home, as firms offshore to be nearer to the client. Overall, our findings suggest that the crisis period has lessened the impact of offshoring service FDI on employment at home.

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Divisions: Aston Business School > Economics, Finance & Entrepreneurship
Aston Business School
Additional Information: © 2017, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International
Uncontrolled Keywords: Employment growth,FDI,OLI paradigm,Offshoring,Relocation,Service sector,Marketing
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Related URLs: http://linkingh ... 148296317303685 (Publisher URL)
http://www.scop ... tnerID=8YFLogxK (Scopus URL)
PURE Output Type: Article
Published Date: 2019-10-01
Published Online Date: 2017-10-21
Accepted Date: 2017-09-28
Authors: Driffield, Nigel
Pereira, Vijay
Temouri, Yama

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